#StablecoinLaw
đ˘ The GENIUS Act, signed into law by President Donald Trump on July 18, 2025, marks a significant milestone in cryptocurrency regulation. This bipartisan legislation establishes a comprehensive framework for payment stablecoins, providing clarity and legitimacy to the industry.
⨠Key Provisions:
- Reserve Requirements:
Stablecoin issuers must hold 100% reserve backing, ensuring stability and trust in the digital asset.
- Licensing and Regulation:
Only licensed institutions, such as banks, credit unions, or regulated fintech firms, can issue stablecoins.
- Federal and State Oversight:
The Federal Reserve, SEC, and CFTC will work together to oversee compliance and enforce penalties for violations.
⨠Impact on the Industry:
- Increased Institutional Investment:
The GENIUS Act is expected to attract institutional investors, potentially leading to a surge in demand for U.S. government debt securities.
- Shift to Ethereum DeFi:
The ban on yield-bearing stablecoins may drive users to Ethereum DeFi platforms, which allow yield generation through on-chain mechanisms.